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Issues Involved:
1. Maintainability of the petition u/s 34 of the Arbitration and Conciliation Act, 1996. 2. Whether NNR's claims are barred by limitation. 3. Award of compound interest and costs. 4. Objections to the enforcement of the foreign Award u/s 48 of the Act. Summary: 1. Maintainability of the petition u/s 34 of the Arbitration and Conciliation Act, 1996: One of the preliminary objections raised by NNR to the petition (OMP No. 201 of 2012) under Section 34 of the Act is that in order for it to be maintainable the place of arbitration must be India. It is submitted that since the seat of the arbitration was KL, the curial law of the arbitration was Malaysian law (as was the proper law of the arbitration agreement). NNR states that Part I of the Act is not applicable to foreign Awards. It is submitted that the competent authority to set aside or suspend the foreign Award as such is a Court in Malaysia, i.e., the country in which the Award was made. Reliance is placed on the decisions in Videocon Industries Limited v. Union of India (2011) 6 SCC 161 and Yograj Infrastructure Limited v. Ssang Yong Engineering and Construction Company Limited (2011) 9 SCC 735. On its part, Aargus argued that Part I of the Act applies to the impugned foreign Award since the substantive law governing the contract was Indian law. Reliance is placed on the decisions in National Thermal Power Corporation v. Singer Company (1992) 3 SCC 551, Aastha Broadcasting Network Limited v. Thaicom Public Company Ltd 2011 (4) Arb. LR 28 (Delhi), Anita Garg v. Glencore Grain Rotterdam B.V. 182 (2011) DLT 365, Bhatia International v. Bulk Trading S.A. (2002) 4 SCC 105 and Venture Global Engineering v. Satyam Computer Services Ltd. 2008 (4) SCC 190. After the conclusion of the arguments in the present case on 31st August 2012 a Constitution Bench of the Supreme Court delivered a judgment on 6th September 2012 in Bharat Aluminium Co. v. Kaiser Aluminium Technical Service, Inc. 2012 (8) SCALE 333. The Constitution Bench overruled both its earlier decisions in Bhatia International and Venture Global Engineering v. Satyam Computer Services Ltd. However, in Bharat Aluminium Co., the Supreme Court clarified as under (SCALE @ p.406): 199. The judgment in Bhatia International (supra) was rendered by this Court on 13th March 2002. Since then, the aforesaid judgment has been followed by all the High Courts as well as by this Court on numerous occasions. In fact, the judgment in Venture Global Engineering (supra) has been rendered on 10th January 2008 in terms of the ratio of the decision in Bhatia International (supra). Thus, in order to do complete justice, we hereby order, that the law now declared by this Court shall apply prospectively, to all the arbitration agreements executed hereafter. (emphasis supplied) Consequently, for the purposes of the present petition, the issue whether the petition by Aargus under Section 34 of the Act is maintainable has to be answered in the affirmative in view of the clarification by the Supreme Court that its decision in Bharat Aluminium Co. would be applicable only to arbitration agreements executed after 6th September 2012. 2. Whether NNR's claims are barred by limitation:One of the preliminary objections raised by Aargus against NNR before the learned Arbitrator was that NNR's claims were barred by limitation. The sequence of transactions between the parties was that first NNR would collect the goods from a client in Shanghai and inform Aargus that a shipment would be arriving on a certain date at a port in India where customs clearance would be given. NNR would charge for collection of the cargo at Shanghai, the transportation of the cargo to Shanghai airport, documentation fee, handling fee, loading of the goods at Shanghai airport (including all related expenses) and air freight. These charges would be collected by Aargus on behalf of NNR from the recipient of the goods in India. NNR would load the goods for shipment by air at Shanghai airport after arranging shipment with the relevant airline. Aargus would clear the goods at customs upon arrival in India and prior to delivery to the recipient. Aargus would collect payment from the client in India for the amount invoiced by NNR as well as air freight. A
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